BKT Company provide the following transactions affecting accounts receivable during the year ended December 31, 2019. Sale (Cash and Credit) ------------------------------------------------ 6,000,000 Cash receive from credit customers, all of whom took advantage of the discount feature of the entity’s credit terms 4/10, n/30 -------------------------------- 3,024,000 Cash receive from cash customers ------------------------------------ 2,100,000 Accounts receivable written off as worthless------------------------ 50,000 Credit memorandum issued to credit customers for sales return and allowances --------------------------------------- 250,000 Cash refunds given to cash customers for sales returns and allowances ------------------------------------- 20,000 Recoveries on accounts receivable written off as uncollectible in prior periods (not included in cash amount stated above) ------------------------------------------- 90,000 The following balances were taken from the January 1, 2019 statement of financial position: Accounts Receivable-------------------------------------- 1,000,000 Allowance for doubtful accounts ------------------------ 100,000 The entity provided for uncollectible account losses by crediting allowances for doubtful accounts in the amount of 80,000 for the current year. Required: What is the balance of accounts receivable on December 31, 2019? What is the balance of allowance for doubtful accounts on December 31, 2019? *Please provide a clear explanation*
BKT Company provide the following transactions affecting
Sale (Cash and Credit) ------------------------------------------------ 6,000,000
Cash receive from credit customers, all of
whom took advantage of the discount feature
of the entity’s credit terms 4/10, n/30 -------------------------------- 3,024,000
Cash receive from cash customers ------------------------------------ 2,100,000
Accounts receivable written off as worthless------------------------ 50,000
Credit memorandum issued to credit customers
for sales return and allowances --------------------------------------- 250,000
Cash refunds given to cash customers
for sales returns and allowances ------------------------------------- 20,000
Recoveries on accounts receivable written off
as uncollectible in prior periods (not included in
cash amount stated above) ------------------------------------------- 90,000
The following balances were taken from the January 1, 2019
Accounts Receivable-------------------------------------- 1,000,000
Allowance for doubtful accounts ------------------------ 100,000
The entity provided for uncollectible account losses by crediting allowances for doubtful accounts in the amount of 80,000 for the current year.
Required:
- What is the balance of accounts receivable on December 31, 2019?
- What is the balance of allowance for doubtful accounts on December 31, 2019?
*Please provide a clear explanation*
Step by step
Solved in 2 steps
